City Council Members Pass Tax Increase

During Tuesday night's budget hearing, East Providence City Council members discussed how to rectify debt issues. Members approved motions that consolidated town employee positions and made alterations to healthcare plans, ultimately approving next year's fiscal budget. According to Finance Director Ellen Eggeman, an additional $115 will be added to the average residential tax bill.

Healthcare and Retirement Savings

6:28 p.m. - City Manger Peter Graczykowski reports a $5 million deficit remains after officials looked for savings in the budgets. Modifications to health care and retirement benefits have saved approximately $440,000. Agreements with unions have reduced projected debts. 

6:30 p.m. - Residents say they are unclear about the net deficit. Officials say there is rollover debt to address using a five-year plan.

School Department Debt

6:40 p.m. - Finance Director Ellen Eggeman says the school department has originally requested $7.3 million more compared to last year. They reduced their expenditures; as it is proposed now, the department will have a $4.3 million deficit. The proposed city budget allocated approximately $1.45 million to help with the school's budget deficit.

Looming Auditor General Intervention

6:47 p.m. - Counselor Michael D. DiGioia says he is concerned with the ongoing deficit problem and the Rhode Island Office of the Auditor General (OAG) will come in if the city and school department members don't balance their budgets. 

6:50 p.m. - The solicitor says the school department did not commit an illegal action because they didn't know their projected revenues. The finance director says school department members operate similarly to the city and was aware of projected revenues.

7:00 p.m. - According to the city manager, the school department has two weeks to come up with a plan to balance their budgets or else the Office of the Auditor General (OAG) will take action. "There is no more tax payer dollars to spend," says Counselor William Conley Jr.

Mayor Bruce Rogers says there is no where else to cut in the city's budget. The school committee needs $4.3 million to continue functioning, said the city manager. The increase would increase taxes above the state's mandated levy. Mayor Rogers says he won't have East Providence residents put on the street due to increased taxes. 

7:10 p.m. - Residents are asking why the council is dealing with these budget deficits now when the deadline to approve next year's budget is Nov. 1. A resident says the school department had an approved budget for at least a month. Mayor Rogers said the council does not have the legal right to cut line items in the school department budget, such as teacher salaries. 

School Department Chairman Speaks 

7:30 p.m. - East Providence School Department Chairman Charles Tsonos says the department inherited debt from predecessors. According to Tsonos, there will be further savings going forward but the the school department has reported their budget as "legitimate and true." There have been administrative reductions and consolidation efforts. An audit company has been commissioned to find more savings. "I welcome that expense audit," Tsonos said. Mayor Rogers says there could be more expense cutting.

Council member Conley cautions Tsonos to ask auditors to work outside the box to garner innovative savings that do not include conflict of interests, referencing "midnight contracts."

7:40 p.m. - Council member Katie Kleyla asks about the consequences of the Office of the Auditor General (OAG) takes control of the city's finances. The city manager replies that the city will not have input regarding future decisions. Kleyla then asks Tsonos if staff layoffs have been considered as the city doesn't have time to waste regarding the budget.

7:56 p.m. - A resident says "gutting the heart of the community" is not the answer as teachers are invaluable to the city; top graduates won't want to move to the city if an inferior eduction system prevails. Council member Conley said the state has graded the city as a school-friendly community. 

8:16 p.m. - Tsonos said the school department's top goal is to pay off debt. Approximately 21 percent of students have qualify for an Individualized Education Program (IEP). The city is still in debt to vendors who have provided those services.

Sewer Rate Increase

8:39 p.m. -  Finance Director Eggeman said the sewer rate could be increased to 7.78 cents. The increase is expected to generate $1.6 million in revenue.

9:08 p.m. - Council members and residents are debating cuts to the libraries. Residents say they would be "horrified" if the libraries lost the ability to use the inter-library system.

Budget Talk

9:32 p.m. - Assistant Mayor Thomas A. Rose Jr. said the proposed library cuts have been reduced significantly but the city has to look for ways to save. "I for one don't want to close any libraries but there are areas that we have to look in." Council member DiGioia said contractual raises have to be honored but the libraries should not suffer. 

Employee Consolidation

9:45 p.m. - The city manager said the consolidation of two facilities positions into one will save $77,000. One employee was laid off; another was asked to assume additional duties, thus was given a $20,000 raise. DiGioia said the raises need to be taken out of the proposed budget or else the state will come in and "everything will fall apart." Council members DiGioia and Conley voted against the consolidation. Council members Rose, Kleyla and Mayor Rogers voted in favor.

10:11 p.m. - Council members DiGioia and Conley voted against a consolidation of an IT position. Council members Rose, Kleyla and Mayor Rogers voted in favor.

Municipal Court Changes

10:29: p.m. - City clerks positions will be eliminated and the municipal court will be available for rent saving about $232,000 per year, according to the city manager. Conley said he would not like to see the municipal court to be dissolved but if the proposition will pass," the funds should go to the libraries.

According to Finance Director Eggeman, the city court has been in the red for the last five years. Valerie Perry, a former city clerk and city council member, said the dissolving of the municipal court would not violate the city's town charter. Counselors DiGioia and Conley voted against the motion. Counselors Rose, Kleyla and Mayor Rogers voted in favor.

City Employee Retirement Benefits

11:00 p.m. - Council member DiGioia asks the city manager if the city could be held liable for legal issues regarding a retiree benefits cost savings measure. "I believe if there was one we would prevail," the manager responds. The retirement contributions of former employees will match the plan of current employees.

11:03 p.m. - The city manager says its a "risky proposition" but the only way the city can stay fiscally healthy is to provide sustainable benefits. The motion passes. 

11:20 p.m. - Mayor Rogers asks the council to consider reversing the motion. Council members voted unanimously in support. "The retirees are tax payers too," the mayor said. The city manager says that was the "extent" of his "suggestions for cuts on the city side."

11:30 p.m - The finance director is discussing the affects of increasing business permit fees to generate revenue. 

11:34 p.m. - Council members approved $66,000 to be allocated to the city's libraries.

11:49 p.m. - According to Finance Director Ellen Eggeman, an additional $115 will be added to the average residential tax bill.